The market value of Roundhay leasehold residential property falls as the lease term becomes shorter and this will have an impact on its saleability. The expense of extending the lease can increase materialy once the remaining term is below than eighty years
It is generally accepted that a residential leasehold with in excess of one hundred years remaining is worth approximately the equivalent as a freehold. Where an additional ninety years added to all but the shortest lease, the premises will be equivalent in value to a freehold for many years in the future.
| Lender | Requirement |
|---|---|
| Coventry Building Society | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| National Westminster Bank | Mortgage term plus 30 years. For Shared Ownership, the remaining term of the lease must be at least 75 years plus the term of the mortgage at the outset of the mortgage. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| TSB | Minimum of 70 years at mortgage commencement, with 30 years remaining at mortgage redemption. |
The lawyers that we work with handle Roundhay lease extensions and help protect your position. A lease extension can be arranged to be completed to coincide with a change of ownership so the costs of the lease extension are paid for using part of the sale proceeds. You really do need expert legal advice in this difficult and technical area of law. The lawyer we work with provide it.
Lewis owned a studio apartment in Roundhay being sold with a lease of a little over 72 years left. Lewis informally approached his freeholder being a well known local-based freehold company and enquired on a premium to extend the lease. The landlord was prepared to grant an extension on non-statutory terms taking the lease to 125 years subject to a new rent to start with set at £150 per annum and increase every twenty five years thereafter. Ordinarily, ground rent would not be due on a lease extension were Lewis to exercise his statutory right. Lewis procured expert legal guidance and secured an acceptable resolution without going to tribunal and ending up with a market value flat.
Mr and Mrs. T Ricardo took over the lease of a first floor flat in Roundhay in July 2012. The dilemma was if we could approximate the compensation to the landlord would be to extend the lease by an additional years. Similar premises in Roundhay with 100 year plus lease were worth £285,000. The average amount of ground rent was £45 invoiced every twelve months. The lease termination date was in 2097. Considering the 71 years unexpired we approximated the premium to the landlord to extend the lease to be within £12,400 and £14,200 exclusive of costs.
In 2012 we were approached by Mr and Mrs. W Mercier who, having moved into a one bedroom apartment in Roundhay in May 1995. The dilemma was if we could estimate the compensation to the landlord would be to prolong the lease by 90 years. Comparative premises in Roundhay with a long lease were valued around £225,800. The mid-range ground rent payable was £60 collected yearly. The lease came to a finish in 2086. Having 60 years left we approximated the premium to the landlord for the lease extension to be between £23,800 and £27,400 not including fees.